UK prelim Q2 GDP Overview
The UK docket has the preliminary Q2 GDP report, which will be published later this session at 8.30GMT. The first estimate of the United Kingdom GDP is expected to accelerate to 0.3% in the second quarter, against 0.2% growth seen in Q1. The annualized reading, however, is expected to show that the pace of expansion has slowed to 1.7% in Q2 versus 2.0% previous.
Deviation impact on GBP/USD
Readers can find FX Street's proprietary deviation impact map of the event below. As observed the reaction is likely to remain confined between 10 and 40 pips in deviations up to 2.5 to -2.5, although in some cases, if notable enough, a deviation can fuel movements of up to 70 pips.
How could affect GBP/USD?
The spot could take a beating on a softer GDP print and test 1.29 handle, as investors would take profits off the table ahead of the FOMC outcome. On a much stronger release, the GBP/USD pair is likely to rally hard in a bid to conquer 1.31 handle.
Technically, “the pair has held above the key 1.30 psychological mark, also coinciding with a short-term ascending trend-line on 4-hourly chart. The mentioned handle now seems to act as an important near-term pivot point, below which the pair could accelerate the fall towards 1.2935 horizontal level en-route the 1.2900 handle. Conversely, sustained move back above mid-1.3000s, leading to a subsequent break through 1.3085 level, should now lift the pair beyond the 1.3100 handle towards testing another ascending trend-line (on 4-hourly chart) resistance near 1.3155-60 zone,” Haresh Menghani, Analyst at FXStreet explains.
Key notes
UK: Q2 GDP to come in at 0.3% q/q - TDS
UK: Q2 GDP likely to post 0.4% q-o-q rise in the initial print - Nomura
About UK prelim GDP
The Gross Domestic Product released by the National Statistics is a measure of the total value of all goods and services produced by the UK. The GDP is considered as a broad measure of the UK economic activity. Generally speaking, a rising trend has a positive effect on the GBP, while a falling trend is seen as negative (or bearish).
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